Correlation Between Made Tech and Concurrent Technologies
Can any of the company-specific risk be diversified away by investing in both Made Tech and Concurrent Technologies at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Made Tech and Concurrent Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Made Tech Group and Concurrent Technologies Plc, you can compare the effects of market volatilities on Made Tech and Concurrent Technologies and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Made Tech with a short position of Concurrent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Made Tech and Concurrent Technologies.
Diversification Opportunities for Made Tech and Concurrent Technologies
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Made and Concurrent is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Made Tech Group and Concurrent Technologies Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concurrent Technologies and Made Tech is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Made Tech Group are associated (or correlated) with Concurrent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concurrent Technologies has no effect on the direction of Made Tech i.e., Made Tech and Concurrent Technologies go up and down completely randomly.
Pair Corralation between Made Tech and Concurrent Technologies
Assuming the 90 days trading horizon Made Tech Group is expected to generate 1.39 times more return on investment than Concurrent Technologies. However, Made Tech is 1.39 times more volatile than Concurrent Technologies Plc. It trades about 0.11 of its potential returns per unit of risk. Concurrent Technologies Plc is currently generating about 0.11 per unit of risk. If you would invest 1,538 in Made Tech Group on September 3, 2024 and sell it today you would earn a total of 762.00 from holding Made Tech Group or generate 49.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Made Tech Group vs. Concurrent Technologies Plc
Performance |
| Timeline |
| Made Tech Group |
| Concurrent Technologies |
Made Tech and Concurrent Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Made Tech and Concurrent Technologies
The main advantage of trading using opposite Made Tech and Concurrent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Made Tech position performs unexpectedly, Concurrent Technologies can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Concurrent Technologies will offset losses from the drop in Concurrent Technologies' long position.| Made Tech vs. Samsung Electronics Co | Made Tech vs. Samsung Electronics Co | Made Tech vs. Hyundai Motor | Made Tech vs. Toyota Motor Corp |
| Concurrent Technologies vs. Playtech Plc | Concurrent Technologies vs. Celebrus Technologies plc | Concurrent Technologies vs. Bisichi Mining PLC | Concurrent Technologies vs. Raytheon Technologies Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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